Ohio Third Frontier Annual Report 2008

Third Frontier 2008 Annual Report

Ted Strickland, Governor Lee Fisher, Lt. Governor

Mark Barbash, Interim Director Ohio Department of Development

Ted Strickland, Governor Lee Fisher, Lt. Governor

Mark Barbash, Interim Director

March 2009 Third Frontier Commission Mark Barbash, Chair

Ted Strickland, Governor, State of Ohio General Assembly, State of Ohio

Ohio Department of Development

Norman Chagnon, Ph.D. Executive Director

John Cullivan Richard Fearon

Eaton Corporation

Eric Fingerhut

Chancellor, Ohio Board of Regents

Robert Kirkbride

Marietta Ventures, LLC

John Kraeutler

Dear Colleague, I am pleased to present to you the 2008 Ohio Third Frontier Annual Report. It has been another remarkable year, with Ohio once again demonstrating its national leadership in the support of technology-based economic development. This report is a welcome opportunity to tell you how a visionary and bipartisan commitment to Ohio’s future prosperity made in 2002 is paying substantial dividends even in these challenging times.

Meridian Bioscience, Inc.

William McCreary Pilkington

Mark Shanahan, Ph.D.

Governor’s Energy Advisor

Third Frontier Advisory Board Mark Collar, Chair

Triathlon Medical Ventures

Joseph Alutto, Ph.D.

The Ohio State University Office of Academic Affairs

Thomas Brady, Ph.D. Plastic Technologies, Inc.

Charles Calvert

Calvert Promotions

Christopher Coburn

Cleveland Clinic Foundation Innovations

Nancy Enright

SEIU/District 1199 WV/OH/KY

Albert Ratner

Forest City Enterprises, Inc.

Joe Sciabica

USAF Research Laboratory

Barbara Snyder

Case Western Reserve University

Thomas Waltermire TeamNeo

Third Frontier Biomedical Advisory Board Tony Dennis, Ph.D., Chair BioOhio

Mark Barbash

Ohio Department of Development

William Hicks, M.D.

Ohio State University Medical Center

David Kay, M.D. Crystal Clinic

Kenneth Preston University of Akron

Baiju Shah

BioEnterprise

David Scholl, Ph.D.

Diagnostic HYBRIDS, Inc.

Third Frontier Bioproducts Advisory Board

In 2008, Ohio Third Frontier reached another high water mark attracting $3.5 billion in additional resources to projects and companies. This represents nearly nine new dollars for every one dollar expensed by the Ohio Third Frontier suite of programs, and tripling the original projected program leverage ratio of three-to-one. To date, Ohio Third Frontier has assisted in the creation, attraction, or capitalization of more than 500 companies in our state, whose staff command an average salary of nearly $65,000 per year. Several highlights stand out: • The Ohio Third Frontier Advanced Energy Program was launched this year to proactively take advantage of the opportunities created by Ohio’s landmark Energy Bill, signed into law in 2008 in response to growing global market demand for advanced and alternative energy products and services. The Advanced Energy Program encourages commercialization of solar, wind, bio-fuels, energy storage and energy efficiency products, and complements our already highly successful Ohio Third Frontier Fuel Cell Program. To date, $12 million in grants to 17 entities have been awarded to accelerate the development and growth of the advanced energy industry in the State of Ohio.

• Unprecedented collaboration and investment by the Ohio Department of Development and the Ohio Board of Regents is attracting world-class researchers through the Ohio Research Scholars Program. This collaboration solidifies our commitment to bringing the best and brightest talent to Ohio – fueling cutting-edge research to realize our long-term economic development goals. To date, the Ohio Research Scholars Program has awarded $143 million to attract 26 scholars that will contribute to the growth of scientifically and commercially relevant clusters of research excellence.

• The Entrepreneurial Signature Program took root at the six regionally located networking organizations that assist in the provision of investment capital and associated services to dozens of technology based start-ups throughout Ohio. The Entrepreneurial Signature Program, launched in fiscal year 2007 with more than $120 million in Ohio Third Frontier grants and associated cost share, is fostering a vigorous entrepreneurial climate throughout Ohio.

We are proud of the accomplishments represented in this report and are commited to making continuous improvements that will keep this initiative vibrant and relevant in a fast-changing economic climate. The Ohio Third Frontier is innovation creating opportunity.

Sincerely,

Robert Boggs, Chair

Ohio Department of Agriculture

Mark Barbash

Ohio Department of Development

James Blank, Ph.D. Kent State University

Wayne Earley

PolymerOhio, Inc.

Mark Barbash Chair, Ohio Third Frontier Commission Interim Director, Ohio Department of Development

Jack Fisher

Ohio Farm Bureau Federation

David Jones John Lumpe

Ohio Soybean Association/ Ohio Soybean Council

77 South High Street P.O. Box 1001 Columbus, Ohio 43216-1001 U.S.A.

614 | 466 2480 800 | 848 1300 www.development.ohio.gov

The State of Ohio is an Equal Opportunity Employer and Provider of ADA Services

Ohio Third Frontier 2008 Annual Report

Ohio Third Frontier

Ohio Third Frontier catalyzes targeted growth in existing and emerging industry clusters by:

The Ohio Third Frontier represents an unprecedented and bipartisan commitment to expand Ohio’s technological strengths and promote commercialization that leads to economic prosperity throughout Ohio.

Designed to build world-class research programs, nurture early stage companies, and foster technology development that makes existing industries more productive, Ohio Third Frontier creates opportunity through innovation.

• Increasing the quantity of high quality, commercially relevant research that accelerates growth for Ohio companies • Expanding access and availability of investment capital to create, grow and attract technology-based enterprises • Growing and nurturing an increasingly experienced pool of entrepreneurial management talent capable of turning an idea into a company • Addressing the technical needs of existing companies pursuing new products and production processes • Contributing to the expansion of a technologically proficient workforce.

With a comprehensive strategy and a focus on our strengths, Ohio Third Frontier is helping to create the industries and jobs that are shaping Ohio’s economic future.

Govenror Ted Strickland visits American Trim – Lima, Ohio

“Ohio’s $1.6 billion Third Frontier initiative is a comprehensive, professionally-run effort to build world-class research capacity, promote interaction between research and industry, and commercialize R&D.” – National Governor’s Association and Pew Center for the States Ohio Third Frontier targets its investments to support technology areas that represent Ohio’s key competitive opportunities: • Advanced and Alternative Energy • Biomedical • Advanced Materials • Instruments-Controls-Electronics Lt. Governor Lee Fisher, center talks with Dr. Robert McKenney, left, and Dr. Michael Knopp, right, during the installation of the latest in MRI technology at Ohio State University, April 2008 – Columbus, Ohio

• Advanced Propulsion

2

Ohio Third Frontier 2008 Annual Report

FY 2008 Financial Information Total Expenditures: $177,230,394 Sources: Third Frontier Research and Development Fund; Wright Capital Fund; Biomedical

Research and Technology Transfer Trust Fund; Third Frontier Action Fund Awards: Number of Awards

Amount (dollars)

Third Frontier Fuel Cell Program

12

$8,820,520

Third Frontier Advanced Energy Program

17

$12,037,236

Success and Pre-Seed Fund Initiative

7

$8,500,000

Engineering & Physical Science Research and Commercialization Program

5

$24,275,000

Biomedical Research and Commercialization Program

6

$22,862,078

Wright Projects

7

$22,479,248

Ohio Research Scholars Program

10

$42,000,000

Ohio Research Commercialization Grant Program

8

$2,789,580

Third Frontier Internship Program

*

$1,500,000

Targeted Industry Attraction

2

$1,250,000

Research Incentive

N/A

$6,000,000

NextGen Network

N/A

$20,000,000

Administrative Expenses

N/A

$4,716,732

Program

Total Expenditures

$177,230,394

* Twelve regionally-based organizations coordinate the deployment of internship funds at up to $3,000 per position.

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Ohio Third Frontier 2008 Annual Report

Performance Metrics Performance Criteria

As of 06/30/08

As of 12/31/08

State Funds Awarded

$873,462,907

$892,915,492

State Funds Expended

$343,299,994

$402,980,005

Cost Share Reported

$891,522,131

$912,882,262

Leveraged Dollars

$3,075,785,242

$3,517,236,062

Leverage Ratio

8.9 : 1

8.7 : 1

Direct Jobs Created and Retained

6,795

7,757

Companies Created, Attracted, Capitalized

466

514

Average Salary

$64,237

$67,654

Cost Per Job

$50,520

$51,951

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Ohio Third Frontier 2008 Annual Report

Funds Leveraged $4,000,000,000 $4,000,000,000 $3,500,000,000

Dollars Dollars

$3,500,000,000 $3,000,000,000 $3,000,000,000 $2,500,000,000 $2,500,000,000 $2,000,000,000 $2,000,000,000 $1,500,000,000 $1,500,000,000 $1,000,000,000 $1,000,000,000 $500,000,000 $500,000,000 $0 $0

Dec-05

Jun-06

Dec-06

Jun-07

Dec-07

Jun-08

Dec-05

Jun-06

Dec-06

Jun-07

Dec-07

Jun-08 Dec-08 Leveraged Funds

Years Years

Dec-08

Leveraged Funds

Companies Created/Capitalized

Companies Companies

550 550 500 500 450 450 400 400 350 350 300 300 250 250 200 200 150 150 100 100 50 50 0 0

514 514

466 466 372 372

383 383

255 255

116 116

Dec-05 Dec-05

213 213

Jun-06 Jun-06

Dec-06 Jun-07 Dec-06 Jun-07 Years Years

Dec-07 Dec-07

Jun-08 Jun-08

Dec-08 Dec-08

Portfolio Companies Created Capitalized Portfolio&Companies Created & Capitalized

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Ohio Third Frontier 2008 Annual Report

Ohio Third Frontier Funds Awarded by Sector $1.2M (IT) $11.4M

$23M $79.2M

$1.2M

$71.1M

$8M

$15M

$34M $29M

$12.5M

$3.5M

Lucas Fulton

$41.9M $0.6M

Ottawa

Williams Defiance

Cuyahoga Erie

Trumbull

Lorain

Huron

Seneca Putnam

Summit Medina

Mahoning

Stark

Wayne

Delaware

Champaign

Licking

Miami

Guernsey Muskingum

Franklin Clark

Fairfield

Noble

Perry

Warren

Monroe

Morgan

Fayette Hocking

Butler

Belmont

Madison

Pickaway

Greene

Harrison

Coshocton

Union

Darke

Montgomery

Jefferson Tuscarawas

Knox

Shelby

Carroll

Holmes

Morrow

Logan

Preble

Columbiana

Richland Hardin Marion

$57M

Ashland

Crawford

Allen

Auglaize

$197.3M

$27M

Portage

Hancock Wyandot

Mercer

Ashtabula

Geauga

Sandusky

Wood

Henry

Paulding

Van Wert

$59M Lake

Clinton

Washington Athens

Ross Vinton

Hamilton

Highland Clermont

$8M

Meigs

Pike

Brown Adams

Jackson Gallia

Scioto

$29M

$5M

Lawrence

$10M

$0.3M (B) $20.9M

$1.2M

$55.4M $22M $38.6M $27.4M

$0.9M (AE) $1.8M $0.5M (ICE)

Biomedical

Total Awards by Sector

Advanced Energy $40M

Instruments, Controls & Electronics

$133M

$328.4M

Advanced Materials

$165.3M

Advanced Propulsion Investment Funds

$87M

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$138M

$1.2M (IT)

Ted Strickland, Governor Lee Fisher, Lt. Governor

Mark Barbash, Interim Director

800 | 848 1300

www.development.ohio.gov

The State of Ohio is an Equal Opportunity Employer and Provider of ADA Services